There are dozens of things that keep one wondering what tomorrow will bring. In fact, there are times it would be interesting to watch the international news throughout the night just to avoid missing something. With the budget situation in Wisconsin spilling into a struggle over union’s ability to negotiate certain items of the teachers’ contracts, we have our own news item to compete with Libya’s unrest. And, with the international price of commodities going up, the cost of living in our nation is highlighting our budget battle going on in Washington.
The items that affect me also affect you. You may not have time to watch the price of some of the items that I pay attention to, but they point out where we are going to be hit with the higher price. At $6 per bushel for corn, feed for my cows started to become a problem. Now it is around $7.25 per bushel - a 20.8 percent increase - and may become a factor in feeding the developing nations as well as providing Corn Flakes for us and feed-stock for ethanol.
The inflated cost of cotton is going to increase the price of cotton clothing no matter what country produces the clothing. And, gold and silver continue to rise beyond reason. A report on the business news stated that 55 percent of the silver production was going into SilverExchange Traded Funds (ETFs) which are holding the silver as a hedge against inflation. That is speculation, not a use that provides for industrial production.
All of this contributes to uncertainty in the investment community as well as putting the promised economic recovery at risk.
It seems everyone who has a television camera on any network has an opinion on why our nation has high unemployment and a disappearing “middle class.” There are many factors that affect all nations’ ability to grow as fast as they would like, but some of them have had a major impact on my thinking. During my years in industry, I worked in several companies and one of them competed with the Japanese in the fastener industry. The company was part of a mini-conglomerate and privately owned.
Through innovation, investment in engineering technology and dedication of a loyal and well paid work force, we survived their invasion and actually beat the imported fasteners at their own government subsidized prices. The owner of the corporation was creative and committed to building in America NOT in a foreign country.
I am convinced that if more American companies’ highly paid professional managers (some Harvard MBAs) looked beyond the quarterly stock price, they would have built more manufacturing capacity in this country rather than going overseas. I worked in plants where we had unions and plants that did not have unions and found the situations required the same honesty and fair compensation regardless. When the Wisconsin struggle comes up in discussions (please remember I lived in Wisconsin for more than 25 years), I remind people that the school boards in many of the school districts allowed the total compensation to get out of hand. This is not just about salary, but health insurance and retirementas well.
At some point, management (in this case school boards) has to say “NO” and defend their decision with facts. Detroit learned the hard way that you can’t keep raising the price of the car without regard for the consumer and the competition. Trying to run a nonunion shop in Detroit was extremely difficult because assembly-line wages were the “standard of living” for all manufacturing companies. And, as we now know the Japanese were able to produce a car, higher in quality, at a lower cost andwith a better warranty than Detroit. Look what happened to General Motors, Ford and Chrysler because they failed to “manage” their businesses for the long term.
The ABC news network recently ran a series on their 5:30 p.m. (CST) newscast about household items “made in America.” They proved that we buy, usually without much thought, foreign-made products and sometimes actually pay more for them than an American made, similar quality, item might cost.
They could not find a television set made in America and the nearest thing they could find to an American coffeemaker was made of parts manufactured in foreign countries and then assembled in the United States.
I blame our own business leaders for most of our problems. A “famous-name maker” of work gloves used to supply only Americanmade gloves and on the farm I usually went through two pair a year at a total cost of about $6. To be competitive, they started providing a foreign-made line of gloves at about $6 for two pairs. However, an importer of “all foreign-made goods” made five pairs available for $6. So, instead of two pairs a year at $6 for the better quality gloves made in America several years ago, I ended up with a poor quality glove that is disposable.
If the “famous maker” name was not sufficient for him to sell his gloves, how an he expect me to buy his imported gloves just because his name is on the glove?
Wal-Mart didn’t invent greed, they just took advantage of a change in a growing world economy to provide the American consumer with a lot of choices of things that we may, or may not, need. Until we, the consumer, demand the made-in-America label on more of our purchases, we are not going to see the manufacturing jobs return to this country.
The biggest advantage our foreign competition has is an aggressive dedicated work force with lower financial expectations than our 40-hour-per-week counterpart. Growing up in Taiwan, my daughter-in-law went to school six days (not five, but six days) a week.
They also were taught civic responsibility by having specific tasks to perform about campus maintaining the school building as part of their class schedule.
Somewhere along the way,our educational expectations have also hurt our industrial competitiveness.
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Editor’s note: Leo Lynch, a native of Benton County has deep roots in northwest Arkansas. He is a retired industrial engineer and former Justice of the Peace. He can be contacted at prtnews@ nwaonline.com.
Opinion, Pages 4 on 03/09/2011